Are there disadvantages to fixed returns?
Should you consider the potential of the stock market?

Many retirees and pre-retirees are drawn to fixed annuities and CDs because they do not want to assume much risk. After all, there is no stock market risk involved with these fixed-return investments. Some people use them as their only vehicles for retirement planning.

But stepping out of the stock market altogether may not be such a good idea. In fact, for some it could be a serious retirement planning mistake. Here’s why.

Risk-averse investing has risks of its own. Every investment has advantages and disadvantages. Fixed-rate investments are no exception. While you eliminate market risk with a fixed annuity or CD, in a sense you are trading one kind of risk for another. You now contend with opportunity risk (or opportunity cost) and inflation risk. The fixed return you get might be far less than the return that stock market investing could bring you (in the short term and the long term). That fixed return might also fail to match the rate of inflation, leaving you with less purchasing power.

Volatility is something many of us endure in order to try for the kind of returns that may help us reach our financial goals. The stock market can be quite volatile. But through the years, some investors have built considerable wealth through long-term stock market investment.

Do you really want to ignore the potential of the stock market? While short-term market movements may make stocks and funds seem too risky, the big risk could be the possibility of severely underfunding your retirement by clinging to fixed-rate investments. The stock market offers opportunities for considerable financial gain – and the chance of returns exceeding those of most fixed-rate investments. While there is risk involved, there also exists a potential for considerable benefit.

If you say “no” to the market’s potential, you may regret your choice later in your retirement. In fact, you may find that you need long-term stock market investment to work toward certain retirement goals.

Explore the possibilities. If you’d like to learn more about investments positioned to take advantage of the market’s potential, be sure to speak with a qualified financial advisor. He or she may be able to help you determine how much risk you’re willing to tolerate, and which investment opportunities are the closest fit with your tolerance level. What you learn might be very illuminating, and it might change your whole investment outlook.

Karen Holmes, MBA, CPA, CFP® is a Representative with 1st Global and may be reached at , 301-998-6108 or holmes@holmesfinancial.com.

These are the views of Peter Montoya, Inc., not the named Representative or Broker/Dealer, and should not be construed as investment advice. Neither the named Representative or Broker/Dealer give tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information.

REIS Commercial Division Meeting

We will be meeting today Monday, August 28th, at the Seasons 52 Restaurant in Rockville for those that can make it.

The Rooftop Mix and Mingle / Wine Tasting by Invitation Networking Event is confirmed for Tuesday September 12th, 2017.Invitations were to be sent out with an RSVP by Friday, September 8th. We will go over this at today’s meeting.

As discussed in our last meeting REIS is seeking is more members i.e. Commercial Architects, Cleaning Services, Mortgage/Hard Money Lenders, your present strategic partners and more Brokers…. etc so inviting them to our next networking event and future meetings should be our priority for the FALL.

On the agenda today we will be talking about gearing up for the FALL business cycle.

Invite any other of your commercial real estate strategic partners who would benefit from meeting members in our group and are looking to expand and build trusting strategic relationships with commercial industry professionals.

Invite any other of your commercial real estate strategic partners who would benefit from meeting members in our group and are looking to expand and build trusting strategic relationships with commercial industry professionals.

REIS Commercial Division Meeting

Reminder The Commercial REIS group is mtg at 12:30pm this Monday, September 25th at :

Seasons 52 Restaurant11414 Rockville PikeNorth Bethesda, MD 20852

If you have any news about your industry that might be of interest for others, looking for specific leads or have any properties you want to
highlight please be prepared to discuss at the meeting.

Invite any other of your commercial real estate strategic partners who would benefit from meeting members in our group and are looking to expand and build trusting strategic relationships with commercial industry professionals.